You can’t overestimate the importance of unconventional plays not only to U.S. drilling and production but also to America’s energy picture. Even as robust oil prices have buoyed U.S. conventional drilling, unconventional rigs have managed to eke out a small gain in market share to 70.7% in 3Q 2011 to date from 69.5% a year ago, according to The Unconventional Drilling Report. It’s clear that unconventional liquids rigs (+48% YOY) are the main driver of the 20% YOY increase in total rig count. Meanwhile, production gains from unconventional drilling have enabled the U.S. to reverse a long decline in U.S. oil and gas output. U.S. crude oil production fell every year since 1985 until 2009’s uptick of 8%, followed by another 2% in 2010. By 2012, EIA estimates total U.S. petroleum liquids production will have risen by more than 1 million barrels per day from 2009. Even with a steep drop in Gulf of Mexico output, EIA predicts U.S. gas production will grow by 4 Bcfd (6.4%) this year and another 1.1 Bcfd in 2012. 

The surge in oil drilling shows no sign of letting up. For the foreseeable future, there are ample economically viable opportunities for liquids drilling, according to The Land Rig Newsletter’s Biweekly Report. Even as sizzling plays such as the Bakken and Eagle Ford still have a lot of room to run, new liquids plays are emerging. Such new plays can be transformational. For decades North Dakota’s rig count barely registered. Thanks to the Bakken, the state now accounts for almost 10% of the nation’s rig count and has perhaps the strongest economy. The shift from gas to liquids drilling has been just as seismic. Looking at oil rig vs. gas rig data for 3Q 2010 vs. 3Q 2011 (July-August), the exchange of respective market shares is uncannily even. The gas rig share of the total count fell from 56.3% to 43.6%, while the oil rig share of the total count jumped from 43.7% to 56.4%. YOY, unconventional oil rigs have accounted for about 9 of the nearly 13 percentage point gain in the overall oil rig count.

The Bureau of Ocean Energy Management, Regulation and Enforcement/U.S. Coast Guard joint investigation team has released its final investigative report on the April 20, 2010, Deepwater Horizon explosion, loss of life, and resulting oil spill. The full report, divided into two volumes and accompanying appendices, can be downloaded from the agency’s website at www.boemre.gov.

National Oilwell Varco, Inc. (NOV) and Ameron International Corporation have received notice from the U.S. Department of Justice of early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act in connection with NOV’s proposal to acquire all of the outstanding shares of Ameron common stock.

 

RLC, the largest privately held helicopter company in the Gulf of Mexico market, announced the appointment of Dru Milke as Chief Executive Officer. The company also recently named Larry Adams as Chief Operating Officer and Michael Guidry as Vice-President of Operations.

 

Cal Dive International, Inc. announced that John R. Abadie, Jr. has been promoted to serve as Executive Vice-President and Chief Operating Officer and that G. Kregg Lunsford has been named Executive Vice-President and Chief Strategy and Business Development Officer of the company.

Reports are that Rowan Companies newbuild jackup Rowan EXL-IV may have a signed contract in place by the end of this week. While the potential customer is not known, market intelligence indicates Apache Corporation could be the operator getting the rig. The LeTourneau Super 116-E design rig, delivered from the Keppel AmFELS yard in Brownsville, Texas, on September 1, is currently undergoing systems testing while waiting on work and is expected to leave the yard in October.

 

Hall-Houston Exploration finally received its permit and now has jackup Hercules 212 on location in High Island Block 205. The ADTI turnkey well is expected to take around 30 days to complete. Meanwhile, jackup Hercules 214 has wrapped up operations for Apache Corporation in Main Pass Block 69 and is now on standby while it waits for its next contract to begin. That work will be for Phoenix Exploration Company, LP in nearby Main Pass Block 59 on a job that was switched from jackup Hercules 253. That rig is also on standby in West Cameron Block 38 while it waits to begin a threewell, 120-day contract with Hall-Houston, now expected to be in early October. Tana Exploration Company, LLC will then ...

BP, PLC announced the drilling of a successful appraisal well in a previously untested northern segment of the Mad Dog field. The well, drilled by BHP Billiton on behalf of unit operator BP, is located on Green Canyon Block 738 in about 4,500 ft of water. The well encountered about 166 net ft of hydrocarbons in the objective Miocene sands and discovered an oil column of more than 300 ft. Pending confirmation, total hydrocarbons in place in the field are now estimated at 4 billion barrels of oil equivalent.